results for the three months ending in November suggested the cutbacks have already started. The showing alarmed investors, causing Oracle Corp. shares to slide nearly 8 percent.

In a telling sign of weakening demand, Oracle's sales of new software licenses edged up just 2 percent from the same time last year. Analysts had expected a double-digit gain in new software licenses. Wall Street focuses on this part of the business because selling new software products generates a stream of future revenue from maintenance and upgrades.

The company earned $2.2 billion, or 43 cents, for share for the three months ending in November. That was a 17 percent increase from net income of $1.9 billion, or 37 cents per share at the same time last year.

If not for certain items, Oracle said it would have earned 54 cents per share. That figure fell below the average estimate of 57 cents per share among analysts polled by FactSet.

Revenue for the period edged up 2 percent from last year to $8.8 billion. Analysts, on average, had projected revenue of $9.2 billion.

Oracle's shortcomings in its fiscal second quarter could mean management's guidance for the three-month period ending in February will be a letdown too. The company is expected to provide its outlook during a conference call later Tuesday.

The company's shares shed $2.28, or 7.8 percent, to $26.89 in extended trading after the results for the latest quarter were released. The stock has been sagging since hitting $36.50 in May.